Enhanced allocation for defence budget

New Delhi: To make our Armed forces more advanced and competitive, Finance Minister Pranab Mukherjee in his Union Budget 2011 has substantially raised defence budget by 11.6 per cent to Rs 1,64,415 crore for 2011-12 from last year's Rs 1,47,344 crore.

Of the total outlay, Rs 69,199 crore has been allocated for the acquisition of modern and new weapon systems, said Mukherjee, while presenting the Budget in Lok Sabha.

With several big ticket deals likely to be finalised this year, the capital expenditure for defence forces has been hiked by Rs 8,366 crore from Rs 60,833 to Rs 69,199 crore.

Defence Ministry sources said the 13.75 per cent hike in capital expenditure has been made keeping in mind the big ticket deals to procure 126 multi-role combat aircraft, 197 light helicopters, 145 ultra-light Howitzers and C-17 heavy-lift aircraft. These deals are likely to be signed this year.

The largest share of the increased capital expenditure would go to the IAF, which will spend Rs 22,055 crore for procuring fighter and transport aircraft and helicopters of different types and origin in this decade.

India has plans of spending over USD 100 billion on defence acquisitions in the next five to 10 years.

The Finance Minister also said the Government is ready to provide any additional support saying, "Needless to say, any further requirement for the country's defence would be met."

Of the total revenue expenditure of Rs 95,216 crore allocations for the next fiscal, the Army has been granted Rs 64,251 crore, Navy Rs 10,589 crore, Air Force Rs 15,928 crore and DRDO Rs 5,624 crore.

Sources said the defence budget accounts for the 13.07 per cent of the total expenditure to be made by the Central government in the next fiscal.

Terming the hike in allocation for his Ministry as "good and positive", Defence Minister A K Antony said, "We welcome it as our concerns have been by and large addressed and Finance Minister has stated that if we have any fresh requirements, it would be made up without any difficulty."

Defence analysts find it a positive indication in the past few years trend which witnessed enhanced allocation to defence demands. According to Defence analyst C Bhaskar Reddy, if we look at the budget allocation of last fiscal’s estimated and final data it becomes clear that Defence Ministry has spent more than 100 per cent.

The data from 1988 to 2004 also inform that Defence Ministry was not able to spend about 20 per cent of its allocated budget.